International Journal of Engineering and Technology

Textile industry contributes 57% percent of total export volumes and 8.5% of the GDP of Pakistan. Government also extended export package and preferential interest rates for working capital exigencies and capital expenditures related to the industry but target never achieved. Though textile policy has aggressive targets but it seems that the policy makers failed to address the real problem that eventually resulted failure of achieving it. On the contrary present government aggressively devaluated the local currency by not taking more loans for controlling exchange rate artificially. This resulted Pakistani exportable products cheaper in international market which attracted future orders in return. But on the other hand, interest rates increased almost double which increased finance cost accordingly. Due to massive devaluation, cost of producing energy increased together with cost of spare parts for maintenance and dyeing chemical for value added products. Therefore, this research is focused to see the impact of factors that could affect the exports either way positive or negative.